Canada in Recession: Loonie Drops in Forex Trading

by Trader Rich

Canadian dollar in currency trading on the FX market
It’s official: Canada is now in recession. On the news — not surprisingly — the loonie has fallen in forex trading against the U.S. dollar. As the global economy continues to erode demand for Canadian exports, the dollar will continue to drop in currency trading on the FX market.

Indeed, the global economy is playing a large role in sending forex traders to the U.S. dollar. They are abandoning currencies seen as "riskier" for those that are considered safe havens. The greenback is one of the safe haven currencies of choice right now as recession marches forward around the world.

Economic news continues to be negative coming out of Canada, and that will only continue to cause problems for the loonie in forex trading.